Onto Innovation Reports 16.5% Revenue Growth and Increased Net Income in Q1 FY 2025

Onto Innovation Inc. reported a significant increase in financial performance for the first quarter of fiscal year 2025, ending March 29, 2025. The company achieved a net income of $64.1 million, or $1.30 per diluted share, compared to $46.9 million, or $0.94 per diluted share, in the same period last year. Total revenue rose to $266.6 million, marking a 16.5% increase from $228.8 million in the prior year. This growth was primarily driven by higher sales of metrology systems to DRAM and NAND customers, although it was partially offset by a decline in inspection system sales.

In terms of operational metrics, Onto Innovation's gross profit increased to $143.2 million, representing a gross margin of 53.7%, up from 52.0% in the previous year. The company reported a decrease in total operating expenses to $80.1 million, down from $89.9 million, largely due to a reduction in amortization expenses as certain intangible assets became fully amortized. The company also noted a significant improvement in cash flow from operating activities, which totaled $92.0 million, compared to $57.1 million in the same quarter last year.

Strategically, Onto Innovation has been active in managing its capital structure, repurchasing 492,000 shares of its common stock for $75.0 million under a $200 million share repurchase authorization approved in February 2024. The company also made a non-marketable equity investment of $8.0 million during the quarter. As of March 29, 2025, Onto Innovation's cash, cash equivalents, and marketable securities totaled $850.6 million, slightly down from $852.3 million at the end of the previous fiscal year.

Geographically, revenue from Taiwan increased significantly to $102.6 million from $71.1 million, while South Korea also saw growth, reaching $93.3 million compared to $80.2 million. However, revenue from China declined to $12.2 million from $21.0 million, attributed to the impact of U.S. export regulations on semiconductor technology. The company continues to face challenges related to tariffs and trade policies, which may affect future sales and operational costs.

Looking ahead, Onto Innovation remains optimistic about its growth prospects, emphasizing its commitment to research and development to enhance its product offerings in the semiconductor industry. The company is closely monitoring market conditions and customer demand, particularly in light of ongoing geopolitical tensions and regulatory changes that could impact its operations.